Tesla May Build the World’s Biggest Lithium-Ion Battery Plant

Tesla doesn’t have enough lithium-ion batteries to keep pace with their booming electric vehicle sales. Although the car maker sold 5,500 Model S sedans in the third quarter, sales might have been stunted by slow global battery production. To mitigate this problem, CEO Elon Musk is now contemplating building a new battery factory that would be the largest in the world.

Tesla recently announced a new deal with Panasonic to buy increase battery sales by threefold, but the overall lack of battery cell supply is hampering Tesla’s global efforts. Elon Musk recently told investors that Tesla had to slow North American demand in order to keep European customers happy. The biggest supply constraint is the battery packs and it will likely get worse when Tesla launches its new $35,000 model likely to be called the Model E.

“If we’re to produce 500,000 vehicles a year from the former NUMMI plant, then we need cell capacity that is commensurate with that, which is maybe bigger than all the lithium ion production in the world today,” Elon Musk stated. Musk also said that if Tesla does decide to build a new battery factory, it will likely be in North America.